Type of Coverage Car Insurance

Type of Coverage to Expect from Car Insurance

Car insurance is a legal requirement in most regions before a driver can get on the road. It means learning about insurance is necessary as soon as an individual is old enough to drive. As more people acquire vehicles, auto insurance products keep flooding the market. Trying to find a suitable policy when you are not even clear about the fundamentals of motor insurance can be a bit confusing. One frequent question about these products is what type of coverage they offer. Before you begin paying for a car insurance policy, know how it caters to your needs as a driver. Although coverage varies across states, the insurer, and product, some features are basic.

Property Damage Liability

During a collision, your car may cause damage to another vehicle or other objects like lampposts, buildings, and fences. Property damage liability allows a car insurance policyholder to pay for such costs. Coverage also kicks in if someone else was driving your car with your permission. Most states set a minimum amount on these policies. An insurer will typically pay for damages up to the policy limit while you are responsible for the excess costs.

Medical Payments or PIP

Personal injury protection or medical payment is another element of car insurance coverage that caters to your individual needs. While liability coverage takes care of the other parties involved in an accident, PIP pays for the bills of the policyholder and passengers. The degree of the coverage will depend on the policy, but PIP will pay for medical treatment and lost wages. Some policies even pay for funeral expenses where they apply.

Uninsured and Underinsured

Even though most states require car insurance, not every driver will have it, and some may have below limit coverage. It means that in an accident case, such drivers would not be capable of paying for the damages you incur whether you sue them or not. With an uninsured policy, you receive cover for property damage and personal injury after an accident. In the instance of an underinsured motorist, your cover will only apply once the other driver’s has run out.

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Collision Coverage

When your vehicle hits a pothole and breaks an expensive component or a tree drops on it while driving in stormy weather, who pays? Collision coverage applies in such instances. The quote is designed to cover damage to the policyholder’s vehicle. This insurance policy helps you pay for repairs even when at fault in a crash. Collision car insurance coverage is usually sold with a deductible, which influences the cost of the premiums.

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